2018-19 Budget Keeps Saskatchewan on Track

The 2018-19 Budget keeps Saskatchewan on track to return to balance next year, with major investments in health care, education, social services and infrastructure, and a steadily improving outlook over the next four years.

“Our government has a plan, and that plan is on track,” Finance Minister Donna Harpauer said. “One year ago, we charted a three-year course to reduce Saskatchewan’s dependency on resource revenue and balance the budget by 2019. This year’s budget keeps that plan on track by controlling government spending, making important investments in health care, education and social services, and by keeping our economy strong through investments in infrastructure and new business incentives.”

The 2018-19 Budget invests a record $5.77 billion to improve health care for all Saskatchewan people, up nearly 2.5 per cent from last year. That includes $3.5 billion for Saskatchewan Health Authority operating funding, up nearly $72 million from total funding last year to the 12 regional authorities. At the same time, $19 million in administration costs are being saved by the amalgamation of the 12 health authorities—savings that are being reinvested in front-line services as part of the $72 million increase in operating funding.

The government will provide an additional $700,000 this year to ensure universal 100 per cent coverage of HIV drugs for Saskatchewan people, and to provide other HIV supports. More than $520,000 is being invested in a new program to ensure that babies born in Saskatchewan hospitals are screened for hearing loss. And $2.8 million is being provided to fulfill the government’s commitment to provide individualized funding for children with Autism Spectrum Disorder. Initial funding of $4,000 per child under the age of six will be provided this year.

“This budget also fulfills the Premier’s commitment to increase education funding by $30 million,” Harpauer said. “This will allow school divisions to continue to support students in the classroom by maintaining or hiring up to 400 teachers and other in-school professionals.”

Saskatchewan’s 27 school divisions will receive $1.87 billion in school operating funding for the 2018-19 school year, up 1.6 per cent compared to last year. This budget also provides nearly $77 million in child care funding. This will support more than 16,000 existing licensed child care spaces in Saskatchewan and help create 2,500 more spaces by 2020.

The budget for social services and assistance will increase by $25 million to a record $1.38 billion. More than $10 million of this year’s funding increase will be targeted to those in communities who provide direct daily care to adults with intellectual disabilities or mental health challenges, as well as for direct supports to families and daily care for children in need of protection. This includes funding increases for foster families, community-based organizations that deliver day programs and residential services to people with intellectual disabilities, and other CBOs that provide family-focused services.

“In this budget, we are continuing to invest in the priorities of Saskatchewan people—in particular, health care, education and social services,” Harpauer said. “We are able to make all of these investments in this budget with no increases to tax rates. That means all provincial tax rates, including provincial sales tax, income tax and property tax remain the same. And, despite the ongoing threats from the federal government, this budget contains no carbon tax.”

The PST exemption for used light vehicles is being removed effective April 11, aligning Saskatchewan’s tax treatment of used light vehicles with every other jurisdiction in Canada that has a sales tax. The trade-in allowance, to allow a deduction for the value of a trade-in when determining PST, is being reinstated. As a result, PST will only be paid on the difference in price between the trade-in and the purchased vehicle.

PST will not be charged for used vehicles gifted between qualifying family members—spouses, parents or legal guardians, children, grandparents, grandchildren and siblings. Unique to Saskatchewan, PST will not be applied to the private sale of used vehicles with a purchase price of up to $5,000.

The PST exemption for Energy Star appliances is also being discontinued. Energy cost savings already provide a strong incentive for consumers to buy these appliances.

Personal Income Tax rates were reduced by half a point in 2017, but will stay the same for the time being, pausing the rate reduction plan announced last year. Indexation of the income tax system has also been paused.

A deficit of $365 million is projected for 2018-19. A return to balance is expected in 2019-20 with a modest projected surplus of $6.0 million. Higher surpluses of $108 million and $212 million respectively are forecast for 2020-21 and 2021-22.

Revenue is forecast at $14.24 billion in this budget, up about $80 million from last year—largely due to higher non-renewable resource revenue, net income from Government Business Enterprises, and other own-source revenue. Revenue from taxation is forecast to be lower—largely due to lower personal and corporate income tax revenue, offset by higher revenue from the Provincial Sales Tax.

Harpauer noted that non-renewable resource revenue now accounts for just 10 per cent of the province’s total revenue, down from a high of 32 per cent in 2008-09.

“One of the main goals of our three-year budget plan was to reduce Saskatchewan’s reliance on resource revenues, and that plan is on track,” Harpauer said.

Expense is forecast at $14.61 billion in this budget, down $200 million or 1.4 per cent from last year.

The 2018-19 Budget makes many other important investments in post-secondary education, in highways and infrastructure, in support for municipalities, in innovation and technology, in the agriculture and resource sectors, in trade and export development, and for First Nations and Métis people. Details can be found in other budget news releases.

“This budget sets the stage for a new decade of growth by keeping Saskatchewan’s finances and our economy on track,” Harpauer said. “The 2018-19 Budget supports our government’s vision to ensure that Saskatchewan is the best place in Canada—to live, work, start a business, to get an education and raise a family, and to build a life.”

2018-19 Budget Keeps Saskatchewan on Track was last modified: April 11th, 2018 by Government of Saskatchewan